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AGOA must not undermine African free trade, says AfCFTA secretary general

AGOA must not undermine African free trade, says AfCFTA secretary general

Mail and Guardian | 3rd November 2023

By Sarah Smit

The secretary general of the African Continental Free Trade Area (AfCFTA), Wamkele Mene, has cautioned that trade ties with the United States should not infringe on efforts to boost regional trade on the continent.

Speaking at the opening ceremony of the 20th African Growth and Opportunity Act (Agoa) Forum in Johannesburg on Friday, Mene underlined the importance of creating greater alignment between the US and sub-Saharan Africa trade programme and the AfCFTA.

“We need to rethink Agoa in this new context presented by the AfCFTA,” he said.

“Whatever the configuration of what Agoa will be, may I make a number of observations framing the dialogue in this emerging context? First, the alignment of Agoa with the AfCFTA must be encouraged. We must assure that Agoa supports the implementation of the AfCFTA, regional integration, and that Agoa does not inadvertently undermine the economic integration progress that Africa has made within the AfCFTA.”

Mene noted that this year’s Agoa forum marks the first during which the majority of AfCFTA signatories have been ratified.

The operational phase of the continental trade pact, which has 47 ratified signatories, was launched just over four years ago in July 2019 and the start of trading under the agreement began on 1 January 2021 — although only limited trade has taken place.

The free trade area is aimed at boosting regional integration on the continent. According to the Brookings Institute, the share of intra-African exports as a percentage of total African exports has increased from about 10% in 1995 to about 17% in 2017, but remains low compared with levels in Europe (69%), Asia (59%), and North America (31%).

Discussions at the Agoa forum this week will focus on the trade agreement’s renewal, as well as ways it may be enhanced. The agreement, which is due to expire in 2025, provides eligible sub-Saharan African countries duty-free access to US markets.

US officials have expressed their support of the AfCFTA, which — if implemented effectively — will go a long way towards boosting the continent’s role in the global economy.

During her address on Friday, US trade representative Katherine Tai remarked that the world economic superpower is “all in” on Africa. In December last year, Tai and Mene signed a memorandum of understanding on cooperation for trade and investment between the AfCFTA secretariat and the US government.

Mene noted that the AfCFTA is not yet in a position to negotiate trade deals as a bloc, given that it does not have its own customs union. This precludes the AfCFTA from negotiating a reciprocal trade agreement with the US.

 source: Mail and Guardian